340B Drug Pricing Program

The 340B Drug Pricing Program (pronounced "three-forty-bee drug pricing program") is a United States federal government program created in 1992 that requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices.

Etymology

The name "340B" comes from the section of the Public Health Service Act under which the program is authorized.

History

The 340B Drug Pricing Program was established by the Veterans Health Care Act of 1992, which is codified as Section 340B of the Public Health Service Act. The program is managed by the Health Resources and Services Administration (HRSA), a part of the U.S. Department of Health and Human Services (HHS).

Eligibility

Eligible organizations and entities include Federally Qualified Health Centers, Ryan White clinics, and state AIDS Drug Assistance Programs, among others. These organizations must be receiving health care-related federal funding or assistance to be eligible for the program.

Operation

The 340B program allows eligible entities to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services. Manufacturers participating in the program agree to provide outpatient drugs to covered entities at prices below the average manufacturer price (AMP).

Related Terms

Pharmaceutical Pricing Agreement (PPA): A legal agreement between the drug manufacturer and the Secretary of the Department of Health and Human Services that formalizes the drug manufacturer's commitment to the statutory requirements of the 340B Program.
Average Manufacturer Price (AMP): The average price paid to the manufacturer for drugs distributed to the retail class of trade.
Covered Outpatient Drug: A drug that is used in an outpatient setting and is eligible for discounts under the 340B Program.

External links

Medical encyclopedia article on 340B Drug Pricing Program
Wikipedia's article - 340B Drug Pricing Program

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340B Drug Pricing Program